When you need equipment to earn revenue in your business, new equipment is not always an option or necessary. On top of a better price, make sure you consider the following when purchasing used equipment, so you do not waste your time or money:
1. Make a checklist to make sure you get what you need.
Consider what you need before starting to look. There might be some great options available, but choice can become overwhelming if you do not have a definitive picture of what you want to buy. It might have worked great for the seller, but you need to make sure it will work for you. Make sure you get the boxes checked on your list and research other brands to look at. Often overlooked is the availability of parts and service in your area, as well as the time and availability of the seller when you are ready to pick it up.
2. Know what similar equipment is selling for.
Start shopping early and make sure you are comparing similar equipment, so you don’t pay more than it is worth. Look at the asking price and compare to the prices at auctions, online and from dealerships. In some cases, it may be prudent to get an appraisal, as appraisers are often well informed on market values and comparisons. If it looks too expensive you can always ask the seller, “Can you show me research that helps me understand your price?”
3. Condition and Inspections.
Equipment with low use-or mileage, one driver, with documented care and maintenance will usually demand higher pricing as a result. If the used equipment you are looking at does not have good records, you better be prepared to dig-in or pay someone to do it for you. Assume any problem with a major component is an indication of less obvious issues.
- Check the Fluids – look for signs of issues.
- Operating Hours and KMs– know the typical limits of the equipment you are looking at.
- Visual Inspection – look it over thoroughly or pay someone else to.
- Functional Inspection – try it out.
- Get it inspected by a 3rd party heavy duty mechanic if you can.
- Ask and look for a guarantee or warranty on any major repairs.
Down time is a double-edged sword with the price of repairs and lack of revenue being the true cost. Prudence pays!
4. Who’s the owner.
Ensure there are no liens against it and that the equipment is not stolen. Liens searches only go by province, so if you think the seller operated in other provinces it may be wise to search the lien there as well. Make sure there is no financing and be aware that usually ownership cannot be transferred if the equipment isn’t paid in full. If it’s not registered then you may also need receipts or bills of sale to establish ownership. This process can take a lot of time and is full of pitfalls.
BUY-SAFE with Patron West!
The process of buying and selling used equipment, particularly between private contractors (aka private sales), can be a challenging process taking longer than expected and presenting risks the seller and buyer are not fully aware of. Representing you as the buyer, Patron West has an exclusive process called BUY-SAFE that helps reduce the stress and clear the risks. See What We Finance.
Once you are Pre-Approved for credit, you can go shopping nearly anywhere you like across Canada and let our BUY-SAFE process help purchase with confidence. Once you select the equipment here is how the process works:
- Your Patron West representative will contact the seller to obtain all pertinent information including, asset images, proof of ownership, work orders, seller ID and banking information.
- Obtain a 3rd party inspection or appraisal if required.
- We will then search both the equipment serial numbers and the seller to ensure there is no direct and indirect liens, security agreements or legal filings.
- Obtain any lien balances or security releases needed so you obtain the equipment free and clear.
- Arrange for payment to the owner and/or lien holders.
When buying used trucks, trailers and equipment getting clear title is the name of the game. Do not cut corners and take on risk you can not afford. BUY-SAFE with PATRON WEST.